Capital Gains Tax & Separation

MandyElk

I am getting divorced. I live in the family home with our 4 children. My ex lives in one flat of a property divided into 3 flats that we jointly own. We lived in a flat in that same property for 5 years when first married (in 1984). He moved back there last February. We now need to sell at least one flat. As one flat is now his main residence are we liable for capital gains? Any advice about what best to do with the other two flats? Should we delay divorce until all 3 are sold to maximise tax allowances? Help!

Doozergirl

Hi Mandy,

I don't know any of the answers sorry, but thought I'd tell you it would be worth you posting this on the Cutting Tax board too

http://forums.moneysavingexpert.com/forumdisplay.html?f=22

Gorgeous_George

If I'm right (and I may not be), you need to pay CGT. CGT will be based on the value sold minus the value when the flat was let less any allowances for improvements such as double glazing, central heating etc. (EDIT: and taper relief)

CGT may not be payable if you sell his flat but there may be a liability if the flat was previously let.

I don't see why waiting for the divorce would make any difference. Two owners = two CGT allowances.

Might be worth speaking to a tax expert to clarify the position.



GG